Frustrated by the lack of progress so far, President Barack Obama dispatched a top team to BP's command center in Houston, Texas, to discuss how to stop the estimated 210,000 gallons of oil spewing into the sea daily from a sunken rig.

Energy Secretary Steven Chu voiced some optimism as he emerged from the talks, as oil company executives were grilled for a second day by lawmakers in Washington.

"Things are looking up," Chu, a Nobel prize-winning physicist, told reporters. "Progress is being made."

As crews added the final touches to a redesigned oil containment box now sitting a mile down on sea bed, Chu cautioned things were still not under control and declined to detail the reasons for his optimism.

But when pressed, he said: "I'm feeling more comfortable than I was a week ago."

The streamlined structure is the latest attempt by engineers to plug the Deepwater Horizon rig, 80 kilometers (50 miles) off Louisiana, which exploded on April 20, killing 11 workers, and sank two days later.

"This is a vital national priority and we cannot and will not rest until BP has capped the well and controlled the spill," said Interior Secretary Ken Salazar, who also visited the BP command center.

With anger growing that oil is still spewing into the seas off the Gulf coast, the Obama administration moved to hike taxes slapped on oil companies to pay for eventual clean-up operations and damages.

It proposed to raise the per-barrel tax for a special liability fund from eight to nine cents, and to increase the fund's cap to 1.5 billion dollars.

Chu and Salazar were leading a team of top administration officials to discuss with BP "how to urgently deal with the critical challenges of controlling and sealing their damaged wellhead," added the interior secretary.

Last week, crews sunk a bigger, domed box to the sea bed and placed it over one of several leak points, hoping to gather up the oil to be pumped to a ship waiting on the sea's surface.

But the effort was thwarted by the low temperatures and high pressure at the sea floor, when icy crystals clogged up the massive structure.

The hope is the smaller, 1.6 tonne version, equipped to allow warm water and methanol to circulate inside, will stop the icy slush forming.

BP began drilling a relief well on May 2 that could divert the flow until the well is permanently sealed, but this may not be ready until August.

And anger is rising among stricken communities along the southern Gulf coast which have already seen livelihoods damaged by a ban on fishing, amid fears for the vital tourism industry and the fragile ecosystem.

The spill is also threatening a political fallout as the Obama administration seeks to uphold pledges to the international community to rein in America's output of greenhouse gases.

US senators on Wednesday proposed expanding environmental protections for offshore drilling as part of a package aimed at battling climate change.

Obama and his allies have backed offshore drilling to woo conservative and industry support, but have encountered strong criticism from environmentalists, especially in the wake of the Gulf of Mexico spill.

Senators John Kerry and Joe Lieberman said they would allow states to opt out of drilling up to 75 miles (120 kilometers) off their shores. Currently, the exemption is only for areas a few miles off-shore.

The three main oil companies involved in the incident have so far traded accusations as to who was to blame for the accident -- the exact causes of which still remain unknown.

But US lawmakers said Wednesday evidence showed a critical safety device had a leak before the disaster and was "defectively configured."

House Energy and Commerce Committee chairman Henry Waxman zeroed in on the rig's "blowout preventer," meant to stop sudden, dangerous rushes of volatile oil and gas.

"We have learned from Cameron, the manufacturer of the blowout preventer, that the device had a leak in a crucial hydraulic system and a defectively configured ram," designed to seal off an oil well's pipes, Waxman said.

Experts have warned the spill could be even more disastrous if the looming hurricane season churns up black waves and blasts the coastline with oil-soaked gusts.

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